Water and sewer hook-up fee financing is approved

Building in Crescent City just got a little easier.

Last week the City Council agreed on a plan to finance new water and sewer hook-ups, allowing property owners to pay connection fees over five years at a low interest rate.

Previously, those aiming to build or expand connections were required to shell out the hefty sum upfront: $9,682 for sewage and $2,700 for water capacity per single-family residential site.

“It was basically prohibiting some people from building a home or starting a new business or maybe even building low-income housing, especially if you are building something with multiple hookups,” said Councilwoman Kelly Schellong. “It can be become quite burdensome if you are having to pay these fees upfront.”

Schellong made the motion to approve the plan on Monday, and it was seconded by Councilwoman Donna Westfall.

Through the payment plan, the city hopes to promote economic development, encouraging building projects and bringing in new monthly accounts, said City Manager Eugene Palazzo.

“We’re not  making a profit on these fees,” Palazzo said. “It goes back into the analysis of what it costs to maintain those hook-ups.”

He pointed to a statewide spike in water treatment costs as a result of market uncertainty and necessary upgrades to infrastructure. In July the city and county’s monthly sewer rates rose by $2.65 in step with rising power costs and debt incurred from bringing the treatment plant up to snuff.

Last week’s resolution, authored by City Attorney Bob Black, establishes a few requirements for deferring hook-up fee payments over a default period of five years, not to exceed 10 years, including: property ownership, a $300 application fee, a 10 percent down payment, approval by the city manager and the city finance director, and as a security measure, a lien on the property to be held by the city.